The figure below shows the marginal external benefit curve (MEB) from the domestic production of mopeds. A tariff has caused domestic production to increase from 500,000 to 600,000.
The increase in external benefits to the nation of the increased production of mopeds because of the tariff is
A. $5 million.
B. $2.5 million.
C. $13.25 million.
D. $7.5 million.
Answer: C
You might also like to view...
Caseload reduction should be viewed as the sole measure of poverty performance
Indicate whether the statement is true or false
The opportunity cost of producing a dining room table refers to the
a. quantity of money required to produce the table b. quantity of money required to buy the table c. quantity of other goods that must be given up to produce the table d. quality of the table e. use of lumber to produce the table
Friedman and Phelps argued that
a. if peoples' inflation expectations were fixed, then an increase in the money supply growth rate could not change output in the short or long run. b. if peoples' inflation expectations were fixed, then a decrease in the money supply growth rate could raise output and unemployment in the short run. c. any change in unemployment created by making aggregate demand increase more rapidly is temporary because people eventually revise their inflation expectations. d. None of the above is correct.
Which statement best describes a command economy?
A. The production of goods and services is determined primarily by markets, but the allocation of goods and services is determined primarily by government. B. The production and allocation of goods and services is determined primarily through markets. C. The production and allocation of goods and services is determined primarily through government. D. The production of goods and services is determined primarily by government, but the allocation of goods and services is determined primarily by markets.